WASHINGTON: The US Transportation Department and NXP Semiconductors NV are joining forces in a pilot project to use communication technology to reduce congestion and speed traffic, they said on Friday.

The department said in December that it would award up to $40 million to a mid-size US city to pilot the efforts.

NXP and partner Cohda Wireless will give the winning "Smart City" wireless communication modules that allow cars to securely exchange data like hazard warnings over more than a mile to prevent accidents and improve traffic flow.

Vehicle-to-vehicle and vehicle to infrastructure communication could prevent up to 80% of crashes where alcohol is not a factor by alerting drivers to hazards like an icy bridge or speeding car, the government said.

"In the near term, it's not about automated driving as much as it's about assisted driving," NXP Chief Executive Officer Rick Clemmer said in an interview.

The technology could be added to police, fire or other municipal vehicles, but that depends on the winning bid and how the city wants to deploy it, he added.